Technology Illiterate

Recently, I heard a great story today from a friend. According to my friend, his business partner is "technology illiterate". After a recent vacation his partner told him that he had filled the memory card on his digital camera and so he bought a new one. My friend asked if he had downloaded the pictures to his computer to free up the card? His partner said, "No. I just buy a new memory card each time it is full."

As the rate of technology change becomes faster (information is already doubling every 2 to 3 years and the rate of change is increasing) how many more people will fall into this "technology illiterate" category? Aren't all of us technology illiterate in some areas? We cannot know everything. I myself find that if I haven't fixed my computer for a few years (they are getting more stable really: -) then I forget the basic things to check first that use to come second nature.

What is the answer to technology overload? How can we function in a world that is changing at an incredibly fast rate?

All of these questions lead to opportunities to develop simpler more elegant solutions that people can use. How is your company handling information overload? Do you have plans for the future and know how technology might effect you and your business? If not you should.

The Great Horse Manure Crisis

Our cities cannot expand. The smell is terrible, and the health crisis even worse. There isn't enough space and there is no solution in sight.

What year do these statements describe?

1900. In 1900 there was a crisis. How do you deal with horse manure? It is hard to fathom today, but in 1900 there were 100,000 horses in New York City and each horse produced about 20 lbs of manure a day - right on the city streets. What could be done to solve this problem? Estimates were that in London, within 20 years horse manure would be 7 feet deep on every street. Experts of the day could find no solution....to grow required more horses and more horses need more food and stables and yes, there is more manure to cleanup.

Today it is equally hard for us to see the changes that digitization will bring to our society and businesses. We are stuck in the horse thinking and need to break out of it to think differently - thinking about how digitization will effect all of us. We are at a point of change equal to that experienced by what the automobile did to the horse manure crisis. Is your business prepared? Are you thinking about what digitization will do to you and your company? We have only seen the tip of the iceberg of the effects of digitization. Hold on to your seat belts it is going to be an awesome ride.

Michael Jackson the last global superstar?

I recently was talking to someone who grew up in India about Michael Jackson. He said he (and most of his friends) were crazy about Michael...he had posters on his walls and followed everything he did. For him Michael Jackson represented America and what America could offer. I would argue that Michael Jackson (or MJ as he referred to him) might be the last global superstar. From India to Europe and the US Michael was an icon. To date no musician has captured the global stage the way Michael did. As evidence, Thriller sold over 100 million copies and the next highest selling album if only 45 million (see http://en.wikipedia.org/wiki/List_of_best-selling_albums_worldwide).

Why did Michael Jackson succeed so successfully? Yes he is very talented, but he also was at the right place at the right time. He appeared on the music world when video and MTV were just getting started. He revolutionized music videos and provided a whole new way for people to engage with him. He did this in a period of time when the mass market of video was still, well a mass market.

Today, the new media is the Internet. However, no music icon has emerged to dominate the Internet the way Michael dominated video. Ok there are people like Paul Potts - who has 19 million views of their youtube video - but that is still tiny compared to Michael selling 100 million album sales. Is this because no one yet has taken advantage of the benefits of the Internet the way Michael took advantage of video? Or is this because the Internet is fundamentally not a focused mass medium? What I mean by this is that everyone can post creating the equivalent of millions and millions of channels. So while the Internet is a mass medium it isn't focused, resulting in interest and attention being fragmented.

Is there no music superstar in the Internet age because no one has the talent or because the Internet is a fragmented medium by its nature making a global superstar much harder to happen? Only time will tell - I tend to think that it is a combination of both of these.

Technology is easy People are hard

I recently saw Barrett Ersek speak (he is a great speaker – you can learn more at www.barrettersek.com) and was impressed with his story. I gave Barrett a call and talked to him in more detail and here is what I learned.

In 2003 Barrett Ersek knew how to get his company to the next level – how to create an incredible competitive advantage for his business. However, he had a problem, a problem that many other companies will face in the Coming Digital Age. His employees wanted nothing to do with it.

In 2003, Barrett was running a successful regional lawn care business but was stuck and having trouble growing to the next level. Then he had a moment of insight – at a conference with other entrepreneurs he was challenged to look at his business differently. He uncovered the cost of acquiring a new client as his major obstacle to growth and came up with an idea for how to dramatically cut it. Traditionally, when a new prospect called in for a quote a person was sent to the prospect’s house to measure their yard and then generate an estimate based on their treatable turf area. Barrett’s aha came when talking to some technology entrepreneurs about aerial mapping. Why couldn’t he use mapping technology to estimate and dramatically cut his costs?

Barrett was extremely excited and left the conference early to put his idea into action. However, he ran into one major unforeseen problem – his employees. As Barrett said “everyone said why it wouldn’t work”. The employees had a vested interest in it not making it work, so they fought it. This is a common problem that revolutionary ideas have in businesses and is an important reason why most successful innovators are not the established players. Barrett’s solution was to “hit the reset button.”

To get a clean start he sold his company to a larger competitor and started over again with no sales, no estimators, no trucks and no office. He spent six months figuring out the technology (it isn’t nearly as simple as it sounds since accuracy is critically important) and then in the winter of 2004 launched HappyLawn in a new market. He had all the knowledge and a clean slate. This allowed HappyLawn to sign-up 1,000 customers from a call center in Iowa before even hiring one person or opening an office in their new location. In one year, his new company was the size of his old company and within a couple more years it was five times bigger.

Technology allowed Barrett to take the estimating process from 3 weeks to 3 minutes. It was the people within his organization that was the hard part. As digitization impacts more and more of our society, we are going to see this scenario play out again and again. The companies that can change and adapt to the new realities will win and the companies that let inertia keep them planted in the past will not.

Try this exercise for your business – clear your mind, get out of the office and think about what is possible in your business and industry. Hit the “reset button” even if only for a few hours and try to envision what would be possible if you started your business again from scratch? How would you build it differently if you had no constraints? Why aren’t you doing it this way today?

Microsoft's new 3D gaming solution

Check out Microsoft's new game technology:
http://news.cnet.com/8301-10797_3-10253892-235.html?tag=newsLeadStoriesArea.1

This is well worth watching. This takes the Wii to the next level allowing the user to move completely around in 3D space, use voice and fully interact with the game in new ways.

Take this to the next level and imagine multi-player games. You could play tennis with a friend across the globe and see and interact with your friend almost like you were on the same court.

Now imagine how this will be when business applications of this occur? Can you imagine video conferencing using this technology where you have two people on either side using this and interacting with each other. If you incorporate Microsoft's surface technology (http://www.youtube.com/watch?v=rP5y7yp06n0) into this image the power of "video" conferencing. I put video in quotes because it is interactive conferencing/meetings - it takes video conferencing to a whole new level. You get many of the advantages of in-person communications with all of the advantages of virtual communications. How long will it take for the pros of interactive meetings to surpass in-person meetings for most meetings? At what point will you use interactive meetings to meet even when the person is just down the hall?

When we reach this point what is the purpose of locating in the same physical building? How will this technology change how we interact with each other, who we interact with and ware we live and work? What impact will this have on your business and how you find and manage We are only just beginning to see the future that the Digital Age will bring about.

Transformations of Industries Google Style

Everything is going digital.

Here is a great article at C|net about how Google is putting itself between traditional businesses from journalism to telecommunications and operating systems.

http://news.cnet.com/8301-17939_109-10250891-2.html?tag=mncol;txt

This supports my premise that once everything is digital the truly unique things happen - you are able to create new business models and new ways of connecting traditional industries.

The Digital Age is just beginning.

Engines of Prosperity

History repeats itself.

Why is the current recession compared so often to the Great Depression? What underlying problems in the economy are similar now and then?

To understand what is happening today in our economy and our market we should first looking at history. My father spent over 20 years researching the history of the stock market and came up with some very unique macro theories about what drives our economy and markets. In 1988 he published a short white paper on his theory called The Engines of Prosperity. Unfortunately, he passed away before he could publish his theories in more detail so all I have are memories of our conversations, this white paper and mounds of documents that he collected over the years.

His theories show that what we are going through is part of a cycle that has happened before and will happen again. The problem is that these cycles are longer than any one person’s business career. Therefore the last time it happened, almost no one working today was alive. This means that experience and "what worked before" cannot apply to the current situation.

He called his theory the Engines of Prosperity. You can read his white paper in detail at www.enginesofprosperity.com. In short, he describes a primary technology engine that drives the economy. It started with steam boats, then railroads and most recently automobiles. We are entering the transition to a new engine of prosperity, the digital age. Each of these engines goes through five distinct phases:

1) Experimentation - characterized by speculation
2) Consolidation - characterized by contraction
3) Development - characterized by investment
4) Saturation - characterized by decline
5) Restructuring - characterized by distribution

In phase 1 the new technology is experimented with - lots of companies sprout up and speculation rules the day. The technology is seen as changing the world dramatically and so investment flows and speculation occurs. This causes a bubble when over exuberance and too many companies are formed to meet the needs. This becomes overdone and phase 2, consolidation ensues where the strong swallow the weak.

Phase 3, development is where it becomes clear which of the companies are going to survive and drive the engine of prosperity forward. This allows capital to flow into these companies and sustained growth to truly take advantage of the promise of the new technology. Finally, after a period of time we enter phase 4, saturation where the engine of prosperity starts to fade. This naturally leads to the restructuring, phase 5, where the industry is distributed and split up as it declines. Over history these phases have lined up so that as an engine enters phase 4 another is appearing in phase 1 and 2.

The last transition between phase 1 and 3 was the great depression where the engine of prosperity for the economy switched from railroads to automobiles. In the 1920s there were some 110 car companies. In the contraction that followed only a hand-full survived to enter phase 3. This transition at first glance, of course impacted the buggy whip maker and the horse and carriage repair shops. However, it also had more profound impacts on all of society: it led to the rise of the suburbs, fast food, commutes, traffic jams, smog, distribution methods, etc. It also impacted other areas such as energy which needed different distribution and means to provide energy to the rapidly growing number of automobiles.

Today we are in phase 2 of the Digital Age. We are transitioning from the experimentation and speculation from Phase 1, to the yet to occur real development of Phase 3, where the true potential of the Digital Age will occur. This period of consolidation will affect most businesses and will weed out the weak. This paper, my speaking and other work look to provide tools and concepts for business owners so they can not only survive this transition, but can position themselves to thrive in the coming developments of Phase 3.